Chapter 3 - The Area Consultative Committees
3.1
As noted previously, 56 Area Consultative Committees (ACCs)
contribute to the administration and implementation of the RPP. Given that ACCs
have a central role in the program and are separate from, but financially linked
to, the administering department, the Committee was concerned to investigate
the role and operations of the ACCs in relation to the RP program.
3.2
The Committee received a wide range of evidence
relating to the role, functions and operations of the ACCs. DOTARS' submission
provided an overview, including documents setting out the detailed operating procedures
for ACCs.[125] Nineteen ACCs provided
written submissions to the inquiry and the Committee heard evidence from the
chairs and executive officers of eight ACCs at public hearings. As discussed in
Chapter 1, the Committee also requested and eventually received relevant
minutes of meetings and recommendations from all ACCs.
Overview
3.3
DOTARS describes ACCs as 'apolitical, not-for-profit,
community-based committees funded by the Australian Government under the Regional Partnerships programme'.[126] Each ACC is an incorporated or
registered body under the relevant state or territory legislation. ACCs were
first established as registered associations in 1995, under the Labor
Government's Working Nation initiative.[127]
3.4
ACC chairs and members are volunteers drawn from the
community, local business and local government.[128] The Minister for Transport and Regional
Services appoints the chair of each ACC for a two-year term.[129] The remaining membership is the
responsibility of the chair and members, under the terms of the articles or
memorandum of association of the ACC.[130]
Each ACC employs a full-time executive officer.
3.5
DOTARS aims to convene a national conference for ACC
executive officers once every nine months. In addition, DOTARS either sponsors
or contributes to several state based or half-state based gatherings of
executive officers.[131] Where
feasible, a DOTARS staff member attends each ACC meeting.[132]
3.6
Together the 56 ACCs cover metropolitan, regional,
rural and remote Australia.[133] ACC boundaries are not aligned with
electorate or local government boundaries, instead they were designed to
reflect 'regional self-definition'.[134]
DOTARS witnesses explained, for example, that ACC boundaries may reflect
natural labour markets or geographic borders.[135]
Structure and operation of the ACCs
3.7
Evidence to the inquiry shows substantial variation in
the structure and processes in place across ACCs. Some committees meet
regularly, others conduct nearly all business via email. Some ACCs have set up
sub-committees with specific roles and functions. Underlying these differences,
all ACCs are required to adhere to certain procedures.
3.8
Several key documents set out the parameters for the
structure, operations and corporate governance arrangements of all ACCs. These
are:
-
The ACC Handbook, including as an attachment the
ACC Charter, Ministerial Statement of Priorities and ACC Work Principles;
-
The ACC Operational Funding Contract with the
Commonwealth;
-
The ACC Strategic Regional Plan; and
-
The ACC Business Plan.
3.9
The Regional Partnerships Procedures Manual is also
available to ACCs.[136] These documents
are available in full either in the evidence provided to this inquiry or from the
individual ACC websites. A brief overview of the documents, as relevant to this
inquiry, is provided below.
The ACC Handbook
3.10
The role and functions of ACCs are defined in the
National Network of Area Consultative Committees Charter, appended to the ACC
Handbook.[137] The Charter sets out three
core responsibilities for ACCs, which relate to facilitating change in their
regions, forming the link between Government, business and the community and
facilitating whole of government responses to opportunities in their
communities.[138] The Charter also
includes a Ministerial Statement of Priorities for ACCs, which lists eight
priority areas for regional development. This statement is designed to 'provide
a nationally consistent direction for ACC strategies and activities'.[139] The Charter also includes a statement
of the work principles to be embedded in ACC operations. Amongst other things,
these principles state the independence of the ACCs:
All activities will be
conducted in a non-partisan manner and in such a way as to be beholden to no
individual, group or organisation.[140]
3.11
The ACC Handbook sets out a range of corporate
governance matters including the legislative basis and requirements of ACCs;
the appointment and role of different ACC positions; conflict of interest;
management of ACC operations including financial management, reporting
requirements and administration; employer obligations; performance assessment
and communication.
3.12
The guidelines on conflict of interest are clear. The
handbook states:
Conflict of interest is one of the most important governance
issues facing ACCs. As a recipient of Australian Government funds, it is essential
that ACCs perform their function in a fair, non-biased, and politically neutral
manner and such that there is no actual or perceived conflict of interest in
the decisions taken by the ACC, on the part of a Chair, member or employee of
the ACC [original emphasis].[141]
3.13
The handbook goes on to define conflict of interest and
sets out DOTARS' expectations for handling conflict of interest. The Handbook
also sets out DOTARS' expectations in relation to ACC involvement in the
political process. Many ACCs, claimed in their submissions and documents
provided to the inquiry, that conflict of interest procedures were rigorously
applied to their operations.
Strategic Regional Plan and
Business Plan
3.14
Each ACC is required to develop a three year strategic
regional plan and to review the plan each financial year. ACCs are asked to consult
with a range of stakeholders in developing the plan, which 'identifies
strategies for addressing the key social, economic and environmental barriers
to and [sic] taking advantage of local opportunities for regional development'.[142] When assessing RPP applications,
ACCs are asked to indicate whether project proposals are consistent with their
strategic regional plan.
3.15
Each year ACCs are required to develop a business plan
setting out their objectives and the activities through which they will
implement their strategic regional plan during the financial year, including
projected operational expenditure.[143]
Operational funding contract
3.16
Each ACC enters into a funding contact with the
Commonwealth for annual operational funding. The contract sets out the agreed
outcomes and terms and conditions for the ACC to receive operational funding.[144] In addition to specifying agreed ACC
activities and operating arrangements, the funding contract sets out the ACCs'
reporting arrangements to DOTARS. These reports include quarterly or
half–yearly reports, an annual report, audited acquittal reports, quality
assurance assessments and performance reports. In addition to their own quality
assessments, every two years ACCs are required to contract an independent
person or agency to conduct a quality assurance assessment.[145]
3.17
Overall, ACC operational funding in 2004-05 was $17,249,183,
with individual funding contracts ranging from $234,032 to $1,105,314.[146] Ms
Riggs noted that differences in the ACCs'
operational funding relate to the different costs of running ACCs in different
areas. Ms Riggs
said:
We recognise that there are quite different cost pressures on
the smaller coastal ACCs up and down the New South Wales
coast than there are on the ACCs that have large geographic regions. It is a
balancing act, of course, because often the employment costs may be higher
nearer some of the capital cities, but the travel costs or some other form of
costs may be lower. That balance in the relative shares of the cost make-up, in
some pretty broad groupings, informs the basic budget for the ACCs.[147]
3.18
Ms Riggs also noted that operational funding for ACCs comes
from the same appropriation as RPP projects, therefore DOTARS needs to strike a
balance between spending on the ACCs and 'putting money into communities'.[148]
3.19
The ACC operational funding contract provides 'funding
for the administration, including employing staff, to conduct the day-to-day
operations and to support the ACC to achieve its outcomes under the Contract'.[149] DOTARS expects all ACCs to employ a
full-time executive officer out of their operational funding and other paid
staff as required.[150] The Committee was
informed that ACC executive officers' packages range from around $85,000 to
$105,000 per annum. Ms Riggs said there were a range of reasons for the
variation in remuneration, including the different sizes of the ACC regions,
different staff management responsibilities of executive officers, differing
levels of travel required and also a 'relative notion of performance'.[151]
3.20
Some ACCs indicated that the operational funding
provided does not adequately account for the different costs associated with operating
ACCs in different areas. For example, executive officers from the Kimberley ACC
and Pilbara ACC
expressed the difficulties these ACCs experienced in attracting and retaining
quality staff, in part due to their inability to offer competitive remuneration
packages.[152]
3.21
The Central Queensland ACC, in a submission to the
inquiry, suggested a review of the ACC funding formula was required:
...the formula used to fund ACC (Administration) regions
(population based formula) needs to be reviewed as soon as practicable.
Maintaining equitable access to participation of the Regional Partnerships
Programme will require as the competitiveness of the programme increases,
higher levels of support.[153]
Role and functions of the ACCs
3.22
DOTARS' submission notes that ACCs provide a regional
network for the promotion and implementation of a range of government programs.[154] In relation to RPP, ACCs have two
key roles—providing information and assisting proponents in developing
applications, and providing comments and recommendations to DOTARS on the
applications made from their region.
3.23
The Committee received generally favourable evidence as
to the competence and effectiveness of the ACCs in fulfilling these roles. Many
submissions to the inquiry, from ACC chairs or executive officers, emphasised
the important role that ACCs play in assisting project proponents to develop
and submit applications, and in providing recommendations to DOTARS which draw
on local knowledge and expertise.[155] Some
submitters questioned the effectiveness of the ACCs, indicating for example that
ACC members lacked experience relevant to the program or to specific projects.[156] The overall impression of the
Committee, however, is that most ACCs comprise dedicated individuals committed
to their region's progress.
Developing applications
3.24
Although applications for funding under RPP can be
lodged directly with DOTARS, applicants are advised to first consult with their
ACC.[157] The program guidelines state:
Your ACC can:
- provide you with advice on obtaining and providing evidence of
broad community and business support for your project;
- assist you with identifying other project partners;
- ensure that all the relevant areas of your application form
are completed in sufficient detail.[158]
3.25
The guidelines go on to advise proponents that:
Involving your ACC in the project and application development
phase will reduce the assessment time with the Department, so it is in your
best interest to consult with your ACC early.[159]
3.26
Similar advice is given in the RPP application form for
projects over $25,000.[160] A different
application form is used for projects of a lesser value. This form does not
recommend that proponents consult with their ACC, but indicates that the ACCs
are available to provide assistance and asks proponents to indicate whether
they have consulted with their ACC in preparing the application.[161]
3.27
The RPP Internal Procedures Manual states that 'Although
there is no formal Expression Of Interest (EOI) form or process, ACC's should
encourage applicants to submit an informal EOI'.[162] Evidence to the inquiry shows that
at least some ACCs follow this process in assisting proponents to develop
applications.
3.28
DOTARS has set out a range of matters that ACCs should
cover with proponents in developing RPP applications. These include ensuring adequate
detail is included in the application, advising applicants of the information
that may be required by DOTARS when assessing the application, and reminding
proponents of the discretionary nature of the program.[163] Other forms of assistance that ACCs are
asked to provide include obtaining funding partners and other support for
projects, identifying project outcomes, identifying and budgeting for
performance measures, and gathering evidence about the project's impact on
other businesses or groups.[164]
3.29
Once applications have been completed, either with the
assistance of the ACC or by the applicant alone, they are submitted to DOTARS.
Applicants are encouraged to submit applications online directly into the TRAX
system, but can also use an electronic 'smart' form, a Microsoft Word based
form, or submit a paper application.[165]
Providing comments and
recommendations
3.30
DOTARS regional office staff assign lodged RPP
applications to the relevant ACC for comments and recommendations. When an
application is assigned to an ACC, the TRAX system generates an automatic
notification to the ACC executive officer.[166]
DOTARS witnesses advised that this step normally occurs within
24 hours of receipt of the application.[167]
DOTARS witnesses also commented that, given the above involvement of ACCs in
developing project applications, 'the vast majority of projects are known to
ACCs before they are lodged as applications'.[168]
3.31
The RPP Internal Procedures Manual states that ACCs should
provide comments and recommendations to the department within 10 working days
for those projects that had been developed in consultation with the ACC.
However, 'the ACCs are not required to meet this timeframe for projects they
have not been consulted on'.[169] In
practice, the timeframes allowed for the ACC assessment process vary widely.
The Committee received evidence that in some cases the full 10 days was
applicable. However, in the case of the UNE maths and science centre, discussed
in Chapter 8, only 24 hours was given for an ACC response. In other cases, such
as the Beaudesert Rail RPP grant discussed in Chapter 4, the relevant ACC was
not consulted at all.
3.32
Ms Riggs
told the Committee that in some cases shorter response times are required:
The procedures manual...I believe sets a...time frame for the return
of the ACC comments, but, in some cases, a project is time critical. Most
commonly time criticality is identified by the applicant, because we ask them
to do that, and then we would talk to the ACC and ask them whether it is
possible for them to formulate their views in less than the time provided in
the standard process.[170]
3.33
The time frame allowed for ACC comments and
recommendations was a particular issue for two projects, Tumbi Creek and the University
of New England maths and science
centre, discussed in Chapters 5 and 8 of the report.
3.34
When commenting on an application, ACCs are asked to
consider the priorities identified in their Strategic Regional Plan, the
objectives and criteria for RPP, the strengths and weaknesses of the project
and any other regional issues impacting on the application.[171] In addition to an overall
recommendation and priority rating for the project (rated 1-4), ACCs provide
comments against seven review questions, covering the project's consistency
with the Strategic Regional Plan, outcomes, partnerships and support, applicant
viability, project viability, duplication and competitive neutrality issues.[172] ACCs provide their comments back to the
DOTARS regional office via the TRAX system.[173]
Status and format of the ACCs'
advice
3.35
It was not clear at the outset of the inquiry the
status that ACC comments and recommendations received once lodged with the
department. The RPP guidelines state that ACCs are the 'Department's primary provider of independent advice on all
applications from their region' [emphasis added].[174] However, DOTARS claimed that the
information provided by ACCs is advice to the minister. The department's
submission states:
Area Consultative Committees (ACCs) make recommendations to
DOTARS and the Minister on local projects as well as outlining their priority
in the region for funding the project based upon...its consistency with strategic
regional plans.[175]
3.36
DOTARS' RPP Internal Procedures Manual states that ACC
comments are encompassed under advice to the minister:
ACC comments are regarded as being advice to the Minister and as
such are exempt documents under Section 36 of the Freedom of Information Act.[176]
3.37
Departmental witnesses held to this view throughout the
inquiry, repeatedly refusing to provide ACCs' comments and ratings to the
Committee for scrutiny, on the basis that this information formed part of the
department's advice to its minister.
3.38
This circumstance contrasted with the Committee's earlier
experience in a similar inquiry, into a grant under a predecessor program
(Dairy RAP), when an ACC's recommendations were discussed openly and at length.[177] Committee members therefore wanted
to know when the change to the 'status' of ACC advice had been implemented. Ms
Riggs said that the decision to use the new
arrangement was made in the first half of 2003, and that the arrangement had
been in place since the inception of RPP on 1 July 2003.[178]
3.39
Ms Riggs
indicated that the changed arrangements had in part been in response to the
findings of the earlier inquiry, which recommended that the department better
specify the respective roles and responsibilities of the ACCs in relation to
program administration.[179] The
relevant recommendation of that inquiry was:
The Committee recommends that DoTARS define the role of Area
Consultative Committees (ACCs) in the implementation of Commonwealth funding
programs and undertake a review of the performance of individual ACCs in
relation to these responsibilities.[180]
3.40
The Committee notes that there is nothing in the above
recommendation that suggests that ACC advice should be withheld from
parliamentary scrutiny.
3.41
DOTARS witnesses told the Committee that the new
arrangement was not motivated by an intention to conceal information. Mr
Peter Yuile,
Deputy Secretary, said:
I do not think the motivation was to keep information from the
committee...the motivation was the question of putting together a robust process
which combined the advice of the department and the advice from the ACCs, who
also...have an independent role in assistance to their local communities. The
motivation was in trying to bring that together and provide the minister with
the most comprehensive picture from both the department and the ACCs; it was
not to keep information away from this committee or from anyone else.[181]
3.42
Nevertheless, the reality of the department's new
arrangement is that information pertinent to the expenditure of public funds
which was previously open to public and parliamentary scrutiny is now withheld
by the department. The Committee considers this development an unnecessary
obstruction to openness and accountability regarding the expenditure of public
funds.
3.43
Given DOTARS' new arrangement of encompassing ACCs'
comments within departmental advice to the minister, Committee members sought
to clarify the independence of the ACCs' comments:
Senator CARR—Last
year, was this committee told that the information of the ACCs was not related,
was independent of the work of the department?
Ms Riggs—In respect of the fact that their advice is conveyed to
the minister—although in a departmentally produced document—it is independent
to the minister and independent of the work of the department. To the extent
that my officers also take consideration of it in considering whether or not
the application matches the Regional Partnerships guidelines by, for example, meeting
the strategic regional priorities determined by the ACC, it is also part of the
formative process of the department in formulating its advice for the
minister—it is both.[182]
3.44
It is not entirely clear from the evidence to this
inquiry the form in which ACC comments are provided to the minister. The RPP
Internal Procedures Manual states that 'Where ACC comments on an application
are not consistent with the Department's recommendation, the Minister will be
advised in the assessor's report'.[183]
3.45
The manual also gives a checklist of items to be
included in the packaging of projects for ministerial decision.[184] This list does not include a copy of
the ACC's review comments and recommendation. It does include individual
project summaries and reasons for the department's recommendation (either
'recommended' or 'not recommended'). These summaries detail, among other
things, the local ACC, ACC contact, and ACC priority. The summary also includes
a project assessment, but it is not apparent the extent to which this assessment
incorporates the ACCs' review comments.
3.46
Ms Riggs
said that ACCs' comments are used by DOTARS staff in formulating the project
assessments, but also indicated that ACC advice is provided directly to the
minister:
I can assure this committee that, quite apart from any use that
the department makes in formulating its assessment and therefore advice to the
minister about a project, which has regard for the ACC’s comments, we relay the
ACC’s recommendations and summary comments to the minister as part of the
package that goes to the minister. So ACCs should be in no doubt that their
advice about a project is directly in the hands of the decision maker—it is not
hidden or obscured from them.[185]
3.47
Documents provided to the Committee by ACCs show that
ACC comments against the review questions give important context and in some
cases place conditions on the priority rating. A case in point is the A2 Dairy
Marketers grant discussed in Chapter 6 of the report. Such context and
conditionality may be lost if only the ACC priority rating is provided to the
minister.
3.48
As the Committee was unable to scrutinise the ACC
advice in the form actually provided to the minister, it cannot conclude
whether this information adequately reflects the comments and recommendations
made by ACCs.
ACC engagement with political
stakeholders
3.49
As discussed in the case studies to follow, the
committee received evidence that the progress of some RPP applications has been
highly politicised, with grant approvals expedited at the expense of sound application
development and assessment procedures.
3.50
In contrast to these examples, the Committee also
received evidence of ACCs engaging appropriately and effectively with a range
of political stakeholders, within the guidelines and procedures of the program.
For example, ACC Tasmania told the Committee that contact with state and
federal politicians was one mechanism through which potential projects were
brought to the ACC's attention.[186]
ACC Tasmania also said that it has meetings with both state and federal politicians
regarding constituents' queries about possible funding for projects, and
respond to politicians' requests about the progress of applications. ACC
Tasmania indicated that it is able to effectively engage with politicians in
sourcing and developing applications and retain independence when assessing
applications. ACC Tasmania submitted:
Minister, parliamentary secretary, other ministers and
parliamentary secretaries, other senators or members and their advisers and
staff, have not had and will not have a role in the ACC comments process of RP
applications.[187]
Assessment phase and funding
decision
3.51
ACCs are not formally involved in the assessment of
applications subsequent to submitting their comments to DOTARS. In some
instances, where DOTARS considers that a lot of additional material is required
to support an application, or the application needs further development, the
proponent may be advised by DOTARS to contact the relevant ACC.[188] However, the usual process is that
ACCs are not again involved until after the funding decision has been made.
3.52
If applications are successful, responsibility for
informing the ACCs lies with the relevant minister.[189] As the minister prefers that government
MPs or Senators have the opportunity to advise successful applicants, proponents
may be advised of funding decisions in advance of the ACCs:
The MP / Patron Senator is notified a project has been funded
and is invited to advise the applicants and make arrangements for announcement.
Two or three days after this, advice to the successful applicants and ACCs will
be despatched by the Minister's Office.[190]
3.53
For unsuccessful applications, ACCs are advised in
writing by DOTARS regional office staff. The procedures manual states that this
advice includes specific reasons for non-approval and that these reasons should
relate directly to the RPP criteria.[191]
3.54
A number of submissions to the inquiry indicated that
ACCs are sidelined during DOTARS' assessment of applications and given
inadequate feedback on the progress of applications.[192] A common criticism by ACC
representatives and project proponents was the lengthy time taken from
lodgement of applications to funding decisions being made. Ms
Robyn Masterman,
Chair of the Barossa Riverland MidNorth ACC submitted:
...once projects have been lodged, departmental officers cannot
give us feedback other than to advise that the project is "currently under
assessment".
This lack of communication can place us in a difficult and
occasionally embarrassing position. After developing close relationships with
proponents during the project development phase – it is often frustrating for
them that we are no longer part of the process. This is especially relevant
when projects are delayed with no explanation forthcoming.[193]
3.55
The RP Internal Procedures Manual confirms that DOTARS
officers are unable to comment on the progress of applications. The manual
advises that once proponents have been advised that an assessment has
commenced, 'there should be no further indication given on the likely timing of
progress of the assessment'.[194] The
manual also states:
The Department has been specifically requested NOT to advise
applicants that their projects are with the Minister or with the National
Office [original emphasis].[195]
3.56
The Committee recognises the need for independent project
assessment. However, transparency of the assessment phase of RPP would be
enhanced if communication between the department and ACC during the application
assessment phase was improved, particularly given the lengthy delays in
assessment of some applications. For
example, ACCs could be provided with a statement of the progress of each
application still outstanding three months after lodgement of the ACC's
comments with DOTARS. The Committee notes that DOTARS and the ACCs have regular
contact and forums for discussion and considers that the matters of timeliness
of application assessment and communication between DOTARS and the ACCs are
best considered in these forums.
Weight given to ACC recommendations
– transparency in decision making
3.57
As RPP is a discretionary grants program, funding
decisions will not always necessarily accord with departmental or ACC
recommendations. In submissions to the inquiry, several ACCs raised the issue
of transparency in regard to application assessments and funding decisions.
3.58
Several ACCs commented that decisions to fund or not to
fund projects appear too arbitrary and are inconsistent across the national
scene. The Hunter ACC commented that ACC recommendations are not always acted
upon, impacting on the ACC's profile in the region and creating a perception
that the process may not be fully transparent.[196] The Orana Development and Employment
Council (Orana region ACC) suggested that transparency could be improved by
making the department's briefs to its Secretary and DOTARS' recommendations to
the minister available to the ACC and proponent.[197]
Promoting the RP program
3.59
In addition to assisting proponents to develop
applications and providing assessment comments on applications from their
region, ACCs also have primary responsibility for promoting RPP. Ms
Riggs told the Committee that it had been a conscious
decision by DOTARS to promote the availability of RPP through the work of the
ACCs.[198] Ms
Riggs explained:
...the predominant [promotional] work is at the local level,
because of the very strong emphasis in Regional Partnerships on there being
partnership, on it being tied to the local community and on it meeting the
needs of the local community. I think the sorts of activities of the ACCs that
are incredibly effective in spreading the word include the fact that most ACCs
do not just meet in one place; they travel around the communities within their
regions.[199]
3.60
ACCs have access to standardised promotional material
which DOTARS requests they use for generic promotion of RPP.[200] In addition, ACCs also develop their
own package of marketing material. This in part reflects that ACCs also play a
role in promoting and implementing other federal or state government programs as
well as RPP, so may each have different marketing requirements.[201] ACC marketing budgets are
scrutinised by DOTARS regional office staff. Ms Riggs explained that while RPP
needs some promotion, 'we would rather see the money go into great supporting
structures in the ACCs, in order to support good projects, rather than into what
I would call untargeted generic marketing or promotion work'.[202]
3.61
The Committee was furnished with a selection of ACC
promotional material during the inquiry, including ACC newsletters and
brochures. Committee members commented on the quality of the material produced,
but also cautioned ACCs to be alert to the possibility of inadvertent political
bias in their advertising and promotional material. As noted previously, ACCs
are established as independent bodies and are expected to conduct their
operations in a non-partisan manner.
ACC outcomes and performance
measures
3.62
One element of the Commonwealth's funding contract with
ACCs is a set of Key Performance Indicators (Annexure 3 to the standard
contract). This annexure describes the outcomes that ACCs are expected to
achieve against their key roles and sets target performance levels.
3.63
Ms Riggs
explained that the Key Performance Indicators (KPIs) had been developed with
the ACC Chairs Reference Group, a group of 12 ACC chairs who meet on a monthly
basis. Ms Riggs
indicated that identifying and refining the KPIs was an iterative process, with
the results of the current KPIs yet to be assessed.[203]
3.64
Evidence to the Committee suggests that the standard
performance goals and measures do not necessarily relate to outcomes preferable
or achievable in all areas. For example, one of the ACC performance measures is
an 'Increase in employment through approved Regional Partnerships projects to
the private sector'.[204] The target
associated with this measure is that, for private sector projects, three or
more jobs are directly created for every $50,000 of regional partnership
funding.
3.65
The Committee received evidence that in focussing on
job creation, RPP was failing to meet the needs of some communities. Mr
Ron Yuryevich,
Chair of the Goldfields Esperance ACC, said that the ACC been had advised that
priority would be given to RPP projects with employment based outcomes. Mr
Yuryevich outlined that this criterion was
inappropriate for the Goldfields Esperance region which already had low
unemployment and difficulty filling job vacancies.[205] Mr
Yuryevich stated that services and
infrastructure based projects were more important for the region than
employment based projects.
3.66
Other submitters raised issues regarding the level of
partnership support required for projects. The KPIs set a target level of an
average of 70 per cent total partnership contribution (55 per cent cash
contribution) for private sector projects. For non-private sector projects the
target levels are different across regions from an average of 50 per cent total
partnership funding (20 per cent cash) in remote areas, to 60 per cent
partnership funding (50 per cent cash) in metropolitan areas.
3.67
Evidence to the Committee showed that a number of
exceptions have been made to allow lower levels of partnership funding for some
projects.[206] For example, RPP grants
were approved to contribute 66 per cent of the Tumbi Creek dredging project
costs, with only 34 per cent contribution from the proponent. In the case of
Primary Energy 70 per cent of the project funding was to come from RPP.
3.68
The Committee heard that partnership funding
requirements can be prohibitive to small remote communities facing hardship. Mr
Warren, CEO of the Orana region ACC,
submitted:
Many communities have a very limited capacity to contribute cash
to projects, especially in cases where the project proponent is a not for
profit voluntary organisation.
Continuing hardship caused by drought has reduced the capacity
of many communities to meet the guidelines for partnership contributions. A
more generous consideration of these guidelines would allow more community and
locally derived projects to come forward.[207]
3.69
Ms Cheryl
Gwilliam, Director General of the Western
Australia Department of Local Government and Regional Development outlined that
some regional communities, including remote Indigenous communities, do not have
the resources or expertise to develop project applications and to liaise with
multiple funding partners. Ms Gwilliam
submitted that while ACCs can give advice, the direct project development
assistance and community development work needed to enable these communities to
access the RPP program is beyond their charter and resources.[208]
3.70
As the Tumbi Creek and Primary Energy case studies
illustrate in Chapters 5 and 7, in some cases lower than recommended levels of
partnership support have been accepted for RPP projects. The Committee is
concerned that RPP guidelines have been waived for costly projects with high
political profile but applied rigorously to exclude other worthwhile projects
at an earlier stage.
Cross region projects
3.71
The Committee received evidence that the structure of
the ACC network and KPIs discourages inter-regional development. Mr
John MacDonald
of the Melbourne Central and Southern ACC said:
...the program generally encourages proponents (and their local ACCs)
to bring forward submissions based on (or within) the artificially defined
regions covered by ACC boundaries. In fact, the Regional Partnerships Program
actively discourages inter-regional cooperation via the establishment of Key
Performance Indicators (KPIs) that do not promote the development of cross-regional
projects. Instead the KPIs focus on further breaking down the already defined
ACC regions into sub-regions.[209]
3.72
Mr MacDonald
also submitted that more complex and innovative RPP projects are put forward in
the metropolitan regions, but that these are viewed less favourably. Mr
MacDonald said that the project evaluation
framework for RPP is tailored to simple projects with clearly defined short-term
outcomes and indicated that for complex projects a two to three year evaluation
time frame may be more appropriate, with part of the project budget
specifically allocated to project evaluation.[210]
3.73
DOTARS informed the Committee that by and large ACCs in
the metropolitan regions have been amalgamated:
Over time the ACCs themselves have come to realise that the
issues in metropolitan Australia
that they were dealing with did not lend themselves to small ACCs but to those
covering larger metropolitan chunks. Melbourne
is the only major capital city where we do not in essence have one large ACC
covering predominantly the whole of the metropolitan area.[211]
3.74
The Committee considers that collaborative projects,
including multi-region projects, should be encouraged and supported by regional
development programs. As discussed later in the report, the Committee considers
that appropriate guidelines and procedures for the development and assessment
of multi-region projects can be incorporated into a standard set of publicly
available RPP guidelines.
Defining the role of ACCs
3.75
Currently, the ACCs have an important role in ensuring
that applications brought forward for RPP funding are appropriate for the
program. As acknowledged by Minister Truss in a recent speech to South
Australian ACCs, ACCs must provide sound advice to ensure that inappropriate or
ineligible projects are not put forward:
Area Consultative Committees are crucial in ensuring project
applications that are submitted to the Department under the Regional
Partnerships program are robust and of a high standard. Without your frank and
honest advice to applicants about the suitability of their early ideas and
proposals, many communities would struggle to meet the very high standards of
assessment.[212]
3.76
Minister Truss also acknowledged that the RP program
may be open to abuse if ACCs did not provide robust advice:
I hope that you will also assist commercial applicants, again by
giving them up-front and honest advice. I would be disappointed if commercial
applicants gained the impression that the Regional Partnerships program was
some form of top-up finance; it should be made clear to them that they are
expected to have sought funds through normal channels, and to present a robust
business case.[213]
3.77
In addition to emphasising the ACCs' role in providing
appropriate information about the RP program, Minister Truss also acknowledged
that the capacity of the RP program to deliver outcomes to communities relies
on the competence of project proponents and that ACCs may be well placed to
assess this capacity:
Your [ACC's] discussions with potential applicants may raise
some concerns that they do not have the experience to manage the projects they
are proposing. In this case, you should encourage them to ensure they have
partners - or even a sponsor – who will help them with the skills needed to run
the project.[214]
3.78
As evident in the A2 Dairy Marketers grant discussed in
Chapter 6, where the proponent's business folded before the project even commenced, there is currently no sound mechanism
in place to ensure that proponents are equipped to deliver projects funded by
RPP.
3.79
Given the Minister's expectations of ACCs stated above,
including reliance on the ACCs to provide advice and to help assess proponents'
capabilities, the Committee questions whether the currently specified roles for
ACCs encapsulate their real contribution to the program. Further, the Committee
questions whether the contribution of ACCs to the program is fully maximised.
With their in-depth community knowledge, ACCs are well placed to assess whether
the program is delivering the real levels of regional development required in
their communities and expected from such a substantial program.
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